Equity markets took a beating through March. Earnings forecasts of many companies have been savaged, with lower growth trajectories likely as households’ movements remain restricted. Incomes and spending have been cut.
Other asset classes have fared much better. Some of them have performed quite solidly over the last year, even in the March quarter. Offshore investments have been particularly assisted by a significant weakening of the Australian dollar against the US dollar.
The following table shows total returns for various types of assets in the most recent March quarter as well as total returns for the past 12 months to 31 March 2020.
Bond investors who bought international bonds through a USD-denominated fund which tracks a well-recognised index after exchanging Aussie dollars fared well. The result for unhedged equity investors in an equivalent equity index fund was less encouraging.